Lerøy Seafood Group Preliminary report 2003 February 26 th Ole-Eirik Lerøy CEO Helge Singelstad CFO
Agenda 1. 1 Considerations 2. 2 Key financial figures 2003 3. 3 Lerøy at a glance 4. 4 Lerøy Seafood Group Company profile 5. 5 Market glance
Internal considerations 4th Quarter 2003 Main figures for 2003 compared to 2002 All figures in mill NOK 2003 2002 Endring Turnover *) 2.915 2.556 14,1% Operating profit 84 55 52,7% Affiliated companies -21-13 -60,8% Pre-tax profit 55 40 37,5% *) Mainly organic growth, Lerøy Midnor will be consolidated from 01.01.04
Internal considerations 4th Quarter 2003 Financially Solid Share issue 4th December 2003, NOK 86,4 mill (2.700.000 shares) Well positioned for future organic and strategic growth Proposed dividend for 2003 NOK 0,60 per share Appr. 2.700 shareholders per February 2004 Increasing number of shareholders Considerably improved liquidity Consolidated Satisfactory operations in most areas in year 2003 Still focus on operations and synergies Lerøy Midnor AS well integrated Affiliated companies Poor results, improved but still difficult market situation
External considerations 4th Quarter 2003 Weak salmon and trout prices Prices increased in Q4 Prices in Q4 03 lower than comparable figures in Q4 02 and still at an low level Higher prices needed Prices so far in Q1 04 higher than comparable prices in Q1 03, but uncertainty in price development Weakened financial and operational performances throughout the industry Enhances restructuring Consolidation Increased market orientation Still difficult market situation in both pelagic and white fish sectors Currencies Future will bring great volatility Political issues / trade barriers Uncertainty regarding regulation of future market access for non-eu producers Salmon-trout case
Agenda 1. 1 Considerations 2. 2 Key financial figures 2003 3. 3 Lerøy at a glance 4. 4 Lerøy Seafood Group Company profile 5. 5 Market glance
Yearly turnover LSG mill. NOK 3500 3000 2500 2000 1500 1000 500 0 1980 1985 1990 1995 1999 2000 2001 2002 2003
Pre-tax earnings LSG mill. NOK 60 50 40 30 20 10 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Quarterly turnover LSG mill. NOK 1000000 800000 600000 400000 2001 2002 2003 200000 0 1. kvt. 2. kvt. 3. kvt. 4.kvt.
Resultatregnskap / Income Statement Q4-03 Alle tall i NOK 1.000 / All figures in NOK 1,000 Q4-2003 Q4-2002 2 003 2 002 Salgsinntekter / Operating revenues 924 630 783 895 2 914 873 2 555 606 Vareforbruk / Cost of goods sold 829 654 712 001 2 614 210 2 326 928 Lønn og andre personalkostnader / Salaries and other personnel expens 44 092 27 115 116 472 91 979 Andre driftskostnader / Other operating expenses 21 062 19 760 85 674 70 447 Ordinære avskrivninger / Ordinary depreciation and amortization 3 633 3 661 14 150 11 207 Driftsresultat / Operating profit 26 189 21 358 84 367 55 045 Inntekt tilknyttet selskap / Income from affiliated companies 128-6 019-20 511-12 753 Netto finansposter / Net financial items 176 1 541-9 196-2 108 Resultat før skattekostnad / Profit before tax 26 493 16 880 54 659 40 184 Beregnede skatter / Estim ated taxation -6 418-3 704-20 577-10 663 Periodens resultat / Profit for the period 20 075 13 176 34 083 29 521
Balanse / Balance Sheet Q4-03 Alle tall i NOK 1.000 / All figures in NOK 1,000 31.12.03 31.12.02 Immaterielle eiendeler / Intangible assets 272 457 23 700 Varige driftsmidler / Tangible fixed assets 183 417 66 714 Finansielle anleggsmidler / Financial fixed assets 275 063 294 951 S um anleggsmidler / Total fixed assets 730 937 385 365 Varer / Inventories 274 823 69 068 Fordringer / Receivables 505 917 384 338 Betalingsmidler / Cash and equivalents 1) 292 749 359 484 Sum omløpsmidler / Total current assets 1 073 489 812 889 Sum eiendeler / Total assets 1 804 426 1 198 254 1) Tall som inngår i beregningen av netto rentebærende gjeld / Figures used in calculation of net interest bearing debt
Balanse / Balance Sheet Q4-03 forts./cont. Alle tall i NOK 1.000 / All figures in NOK 1,000 31.12.03 31.12.02 Innskutt egenkapital / Equity contributions 656 043 505 342 Opptjent egenkapital / Earned equity 127 781 113 130 Minoritetsinteresser / Minority interests 10 325 22 604 Sum egenkapital / Total equity 794 149 641 076 Avsetning for forpliktelser / Accrued liabilities 8 647 4 709 Langsiktig gjeld / Long-term liabilities 1) 412 195 182 432 Kortsiktige kreditter / Short-term loans 1) 242 898 80 549 Annen kortsiktig gjeld / Other short-term liabilities 346 537 289 489 Sum gjeld / Total liabilities 1 010 277 557 179 Sum egenkapital og gjeld / Total equity and liabilities 1 804 426 1 198 254 1) Tall som inngår i beregningen av netto rentebærende gjeld / Figures used in calculation of net interest bearing debt
Key figures Lerøy Seafood Group Q4-03 Nøkkeltall / Key figures Q4-2003 Q4-2002 2 003 2 002 Resultatmargin / Profit margin 2,87 % 2,15 % 1,88 % 1,57 % Driftsmargin / Operating margin 2,83 % 2,72 % 2,89 % 2,15 % Resultat per aksje / Earnings per share 0,66 0,45 1,15 1,13 Utvannet resultat per aksje / Diluted earnings per sh 0,66 0,45 1,15 1,13
Key figures Lerøy Seafood Group Q4-03 Nøkkeltall / Key figures Q4-2003 Q4-2002 2 003 2 002 Avkastning på sysselsatt kapital / ROCE 18,72 % 11,84 % 9,60 % 8,75 % Egenkapitalandel / Equity ratio 44,01 % 53,50 % Netto renteb. gjeld / Net int. bearing debt -362 344 - Forløpige tall er ikke revidert / Preliminary figures have not been audited
Lerøy Seafood Group consolidated 2003 Lerøy Seafood Group s total equity is 794,1 mill NOK Subsidiaries share of group equity is 448,6 mill NOK Operating profit for YTD 2003 is 84,4 mill NOK
Affiliated companies Balance at 31.12.03 31.12.02 Norskott Havbruk AS (50%) 155,1 mill 153,0 mill Hydrotech Gruppen AS (39%) 91,1 mill 104,0 mill Egersund Fisk AS (27%) 22,6 mill 22,0 mill Total Lerøy Seafood Group s total equity 268,8 mill 279,0 mill 794,1 mill 641,1 mill
Lerøy Seafood Group Norway s largest seafood exporter 9,1 % market share of Norwegian Seafood total exports (by value) 14,6 % of Norwegian salmon export in 2003 Major shareholder in fish farming operations Lerøy Midnor AS (100%) (Nye Midnor AS) Scottish Sea Farms (50%), 2 nd largest Scottish salmon producer Hydrotech-Gruppen AS (39%) Japan single largest market, EU most important region overall
Agenda 1. 1 Considerations 2. 2 Key financial figures 2003 3. 3 Lerøy at a glance 4. 4 Lerøy Seafood Group Company profile 5. 5 Market glance
Lerøy Seafood Group Global distribution network Global distribution from Head Office in Bergen Local distribution and processing in Sweden Local representative offices in some key markets (France, Spain, Italy, Japan, China, USA)
Lerøy Seafood Group Steady growth in operating profit and strong balance sheet Stable earnings despite turbulence in the sea food industry Growth potential within recently acquired businesses Satisfactory liquidity / credit facilities Professional and highly educated employees Partnerships / Network of alliances
Shareholders 19.02.04 Shareholder No. of shares Ownership share Ole-Eirik Lerøy 4 685 000 13,60 % Ferd Private Equity 3 281 307 9,53 % Sparebanken Midt-Norge 1 768 010 5,13 % Skagen Vekst 1 700 000 4,94 % Tine Pensjonskasse 1 317 300 3,82 % Knut Hallvard Lerøy 1 253 210 3,64 % Hallvard Lerøy Jr. 1 190 900 3,46 % DnB ASA, Egenkapital Invester 1 055 218 3,06 % Deutsche Bank AG London 1 015 200 2,95 % Lime AS** 610 573 1,77 % George Harald Lerøy 475 000 1,38 % Gambak C/O 450 000 1,31 % Pareto C/O 450 000 1,31 % KOS Bergen AS 406 640 1,18 % Inma AS** 400 000 1,16 % SalMar AS 386 826 1,12 % Sparebanken Rogaland 386 722 1,12 % Gjensidige Nor 381 473 1,11 % Firstnordic Norge VE 380 500 1,10 % Sunnhordland Fjordbruk AS 341 600 0,99 % Total 20 largest share owners 21 935 479 63,69 % Others 12 505 288 36,31 % Total shares 34 440 767 100,00 % **controlled by CEO Ole-Eirik Lerøy The company has a total of appr. 2.700 sharholders.
Agenda 1. 1 Considerations 2. 2 Key financial figures 2003 3. 3 Lerøy at a glance 4. 4 Lerøy Seafood Group Company profile 5. 5 Market glance
Lerøy Seafood Group ASA Sales & Distribution Production Lerøy Lerøy Sverige AB Sverige AB 80% 80% Hallvard Hallvard Lerøy Lerøy AS AS 100% 100% Nordvik SA Nordvik SA 80% 80% Lerøy Lerøy Smøgen Smøgen Seafood Seafood AB AB 100% 100% Lerøy Lerøy Midnor AS Midnor AS 100% 100% Sigerfjord Sigerfjord Aqua Aqua AS AS 90,55% 90,55% Sales and distribution in Sweden Strong position towards catering and supermarkets Sales and distribution ww Local representation: USA, France, Spain, Italy, UK, Japan, China Sales and distribution in France Strong position towards Hyper- and supermarkets Cold and hot smoked seafood products, salads and shellfish in brine. Production of Salmon, Salmon trout, Smolt Slaughtery and processing Production of Arctic char Affiliated Farming/other Norskott Norskott Havbruk Havbruk AS AS 50% 50% Hydrotech Hydrotech Gruppen Gruppen AS AS 39% 39% Egersund Egersund * * Fisk Fisk AS AS 27% 27% Hjaltland 11% Hjaltland 11% * Pelagic related activities
Lerøy Seafood Group PELAGIC WHITEFISH FARMED FISH HALLVARD LERØY AS SALES - MARKETING DISTRIB. FRANCE Nordvik DISTRIBUTION UK SSF / LERØY Lerøy France Lerøy China DIRECT EXPORT Lerøy Italy Lerøy US Lerøy Japan Lerøy Spain DISTRIBUTION NORWAY DISTRIBUTION Lerøy Sweden PROCESSING Lerøy Sweden FARMING / PROCESSING NORWAY
Lerøy Seafood Group - Global organization Scotland/Shetland Farming Dist. & Sales Spain, France Dist. & Sales Norway Farming Dist. & Sales Sweden Dist. & Sales Japan Dist. & Sales Italy Dist. & Sales China Dist. & Sales North America Dist. & Sales
Lerøy Midnor AS
Structure Nye Midnor AS Production Nye Midnor AS Smolt Smolt 5 5 licenses licenses Farming Farming 26 26 licenses licenses Slaughtery Slaughtery Processing Processing
Description of Lerøy Midnor AS Production Smolt: 5 licenses 6 mill. smolt per year (salmon/trout) Farming: 26 licenses (salmon/trout) All production is located along the coast of Møre and Romsdal and Midt-Norge 2004E: 16.000 gwt salmon 3.000 gwt salmon trout Slaughtery: Capacity of 65 tonnes per shift 47% ownership in Uthaug lakseslakteri AS Processing: Capacity of ca. 3.500 t per year Production of skin and bone free portions and fillets Organisation: Competent and committed
Lerøy Midnor AS Results and balance NOK YTD 2003 *) Revenues 216,7 EBITDA 5,9 EBIT -17,3 Pre tax -41,4 **) Balance sheet 31.12.2003 ***) Licences / Goodwill /def. Tax 62,4 Fixed assets 111,0 Inventories 228,7 Other current assets 117,2 Total assets 519,3 Equity 28,2 Debt 491,1 Total equity and debt 519,3 * Company established July 11. 03 ** Will be consolidated in group P&L from 01.01.04 *** Consolidated in group balance from 31.12.03
Lerøy Seafood Group Consolidated Key figures Total equity (44,01 %) 794,1 mill Net interest bearing debt Total intangible assets Licences fish farming Norway Goodwill 362,3 mill 272,5 mill 195,0 mill 77,5 mill Total LSG-shares 34.440.767 shares
Lerøy Seafood Group - Sales per market 2003 USA and Canada 9,9 % Norway 5,7 % Others 1,1 % 2002 Asia Pacific 14,4 % Eastern Europe 7,8 % Europe 61,1 % USA and Canada 7,2 % Asia Pacific 18,6 % Norway 8,5 % Others 0,8 % Europe 55,1 % Eastern Europe 9,8 %
Lerøy Seafood Group - Sales per product 2003 6,0 % Other/other species 3,8 % Salmontrout 5,1 % Whitefish 10,4 % Pelagic fish Shellfish 5,6 % Whole salmon 47,5 % 2002 Shellfish Salmontrout 4,1 % 7,0 % Other/other species 4,1 % Pelagic fish 10,9 % Whole salmon 38,5 % Processed salmon 21,7 % White fish 14,8 % Processed salmon 20,5 %
Norskott Havbruk (Scottish Sea Farms Ltd.) Production capacity: 25.000 30.000 gwt Volume harvested in 2003: 24.000 gwt Est. harvest volume 2004: 21.000 23.000 gwt Additional processing and sales: 5-10.000 gwt 2 processing plants
Norskott Havbruk (Scottish Sea Farms Ltd.) SQS Label Rouge ISO 9002 ISO 14 001 Investor in people VIBES of Scotland
Norskott Havbruk NOKm Q4-2003 Q4-2002 31.12.2003 31.12.2002 Revenues 227,4 152,8 708,3 562,8 EBITDA 25,0 2,1 57,8 37,2 EBIT 17,6 3,3 28,2 7,9 Pre tax 10,7-4,2 2,1-20,9 Volumes (gwtt) 24,0 19 Balance sheet 31.12.2003**) 31.12.2002*) Licences, Goodwill 375,9 381,7 Fixed assets 90,8 91,0 Inventories 323,5 333,6 Other current assets 112,6 94,4 Cash 7,9 1,0 Total assets 910,7 901,7 Equity 315,5 315,0 Interest bearing debt 472,7 457,4 Non interest bearing debt 122,5 129,3 Total equity and debt 910,7 901,7 *) NOK/GBP = 11,62 **) NOK/GBP = 11,89
Hydrotech Gruppen AS (39%) Ownership 39% owned by Lerøy Seafood Group ASA 57.3% owned by L & K Karlsen Holding AS 3.7% owned by others Wholly integrated fish farms in Norway 17 wholly owned licenses Estimated sales 2004: Salmon and trout estimated : 12 gwtt (14 gwtt) Smolt production: appr. 5 mill Wellboat shipping co. Slaughtery Processing plant
Hydrotech Gruppen NOK Q4-2003 Q4-2002 31.12.2003 31.12.2002* Revenues 124,4 48,3 381,6 349,0 EBITDA -6,2 2,6-11,1 25,7 EBIT -14,1 0,6-33,0 6,5 Pre tax -16,7-7,8-50,6 3,7 Balance sheet 31.12.2003 31.12.2002 Licences / Goodwill 139,9 141,2 Fixed assets 164,3 175,4 Inventories 142,2 217,7 Other current assets 18,8 52,4 Total assets 465,2 586,7 Equity (incl. new issue) 121,2 131,8 Debt 344 454,9 Total equity and debt 465,2 586,7 Net interest bearing debt 270,9 363,7 * Including gain on sale of assets appr. 25 mill
Egersund Fisk AS (27%) Shareholder structure Lerøy 27% SalMar 27% Egersund Fiskeriinvestering 9% Others 37% (less than 4% each) Pelagic activity Fish oil, fish meal Pelagic fish for consumption Ownership in vessels for wild catch Production of ice Part ownership acquired in 2001 Egersund Fisk 100% 2003 2002 Turnover 312,5 364,6 EBIT 9,4 10,9 Pre tax profits 1,8 4,5
Agenda 1. 1 Considerations 2. 2 Key financial figures 2003 3. 3 Lerøy at a glance 4. 4 Lerøy Seafood Group Company profile 5. 5 Market glance
2003-12 2003-24 2003-36 2003-48 2004-08 2002-28 2002-40 2002-52 2002-16 2001-44 2002-4 2001-20 2001-32 Fresh Atlantic Salmon Norway (4-5 kgs) price development 1997 - YTD (FHL/NSL) NOK / Kg 45,00 40,00 35,00 30,00 25,00 20,00 15,00 10,00 5,00 0,00 1997-1 1997-13 1997-25 1997-37 1997-49 1998-9 1998-21 1998-33 1998-45 1999-4 1999-16 1999-28 1999-40 1999-52 2000-12 2000-24 2000-36 2000-48 2001-8 Source: FHL/NSL
Salmon export from Norway as of week 9-04. Fresh atlantic salmon, cross-section, FCA Oslo. w. 27-03 NOK / kg Oslo W 40-01 W 44-01 W 48-01 W 52-01 W 4-02 W 8-02 W 12-02 W 16-02 W 20-02 W 24-02 W 28-02 W 32-02 W 36-02 W 40-02 W 44-02 W 48-02 W 52-02 W 4-03 W 8-03 W 12-03 W 16-03 W 20-03 W 24-03 W 28-03 W 32-03 W 36-03 W 40-03 W 44-03 W 48-03 W 52-03 W 4-04 28,00 26,00 24,00 22,00 20,00 18,00 16,00 14,00 Q4-01 Aver. 17,24 Q1-02 Aver. 18,04 Q2-02 Aver. 21,77 Q3-02 Aver. 20,16 Q4-02 Aver. 20,76 Q1-03 Aver. 20,42 Q2-03 Aver. 18,92 Q3-03 Aver. 18,09 W 8-04 Source: FHL/NSL Q4-03 Aver. 20,35 Q1-04 Aver. 21,73
Atlantic salmon supply side SUPPLY Change Change Norway Chile UK Canada Faroe Islands Ireland USA Australia Iceland Others 2003 508 600 280 800 160 300 92 000 47 000 18 400 18 200 14 000 4 200 1 800 02-03 14,3 % 4,7 % 14,4 % -17,9 % 11,6 % -17,5 % 37,9 % 7,7 % 20,0 % -10,0 % 2004 E 501 000 340 900 137 200 86 000 31 500 17 600 13 300 15 200 4 700 2 400 03-04E -1 % 21 % -14 % -7 % -33 % -4 % -27 % 9 % 12 % 33 % In total 1 145 300 7,9 % 1 149 800 0,4 % Figures per 24.02.04 Source: Kontali
Atlantic salmon demand side DEMAND Change Change EU USA Japan Others 2003 537 400 312 700 50 200 236 300 02-03 8,5 % 6,1 % -23,1 % 10,5 % 2004 E 587 000 331 500 50 600 257 400 03-04E 9 % 6 % 1 % 9 % In total 1 136 600 6,3 % 1 226 500 8 % Figures per 24.02.04 Source: Kontali
Drivers year 2003 Norway EU (+ 46.696 mt) + 17,0 % Norway Eastern Europe ( 14.184 mt) + 78,9 % Norway - Japan (- 5.066 mt) - 15,0 % Norway - Feed sales (768 100 mt) + 5,0 %
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